Many try to establish a precise definition of the luxury real estate market like that found on the internet by a credit repair company which states that:
“The luxury real estate market brings together all high-end and prestigious real estate assets, that is to say real estate whose market value is at least 8 times higher than the national average of prices per m² observed. »
Where does this source and calculation method come from for such a definitive definition of the luxury real estate market?
If we push this analysis further and try to go deeper based on this definition given as an example, using as indicators of prices per m² those given by French notaries (which we can think are fair given that notaries are the obligatory passage for any real estate transfer and therefore have a reliable database on the prices of transactions actually recorded), the attempted definition given above the luxury real estate market could be criticizable.
According to French notaries, calculated on the basis of 129,392 recorded real estate sales, here are the prices per m² in France for old houses and apartments:
- High price
€3,820 / m² - Median price
€2,460 / m² - Low price
€1,570 / m²
Observation period: from April 2022 to June 2022
These figures are in theory since French notaries collect all the statistics of real estate transactions at the source even if the disparities are great when we go down to the regional and city level.
So, if we take as a definition the one noted above, knowing that the luxury real estate market would correspond to goods whose value is 8 times higher than the national average of prices observed per m², based on the statistics of property prices. notaries of France, this would mean that the luxury real estate market would only concern properties whose prices could start at 8 times €2,460/m² (median price of notaries) or €19,680/m²?
What about those goods which would only be 3, 4 or 5 times higher than the national average for France then?
It is clear that an approach to the luxury real estate market based on such calculations which rely on a price per m² to classify a property falling into the luxury category means nothing at all in truth!
A property cannot be classified in the luxury category with the sole criterion of taking into consideration its price per m².
In conclusion, the luxury real estate market is in itself a segment or part of the real estate market taken as a whole, a niche market, a particular market for which it seems impossible to establish a universal definition.
